The profitability v service debate

There is a constant tug of war in business between generating greater profit and providing the highest-quality customer experience possible. My Business speaks with one SME director who says he has found the perfect balance.

Alexander Laureti, a partner of accounting firm LMS Advisory, says the balance between profitability and service delivery comes down to building relationships.

“The relationship that we try and build is more than just tax and compliance,” he explains on the My Business Podcast.

“We like to get involved with, whether it's individuals, whether it's businesses, we try to be holistic. We try to say, ‘There's more to your business than just the numbers, just lodging your tax’.

“There's a whole other aspect of it in terms of working out where you want to go for work-life balance. What's happening with your personal affairs? What's happening with your succession plan? Where do you want to be by the time you get to retire?”

Alexander says he focuses on making sure LMS Advisory is “a well-oiled machine”, allowing clients to feel they are receiving more than just a service – that they are looked after and have a sense of importance.

“[Clients are] the bread and butter of our business. We value each and every single one,” he says.

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However, it is essential to balance securing new clients and taking care of existing ones.

“I didn't ever want to be in a position where I had to turn away someone because I was too busy or I couldn't take them on,” says Alexander.

“We've always geared our practice to be a little bit over-resourced, in terms of staffing, in terms of systems and everything else.

“If you look at our statistics, we're a little bit less profitable than other accounting firms, but it's given us the opportunity to take on a new client basically straight away.”

“Whether they're small, large, whether they have a pressing business need or something else, we can basically take up that challenge and service them straight away.”

Through building long-term relationships with clients, Alexander says that not only is a service provided, but clients receive extra care, which can lead to further growth via word of mouth.

“We're really building our practice to be able to say, ‘We want you to be able to come to us, and we'll be able to service all of your needs, whatever it is that they are. Even if it's not me personally who does the service, I can put you in touch with the right person who can help you in a holistic sense’,” he says.

“That should be something that then, if you're a happy client, then you should be able to tell your mate and say, ‘Hey, if you're not happy with your accountant, you should go to [LMS Advisory] because they're great’.”

“If you do a good job and you do the right thing by people, naturally then just in conversations that clients might have at barbecues with their friends and everybody else, if they hear out there that people aren't getting the services that they require, then naturally our name might be put forward as somebody who could help them.”